UK Budget Introduces Machine Games Duty Increase Alongside Persistent Bingo Licence Arrangements

Chancellor John Healey announced the Budget on October 28, 2026, which included an increase in Machine Games Duty on slot machines from 20% to 25% effective April 2027, while also removing business rates discounts for adult gaming centres known as AGCs or slot farms. Observers note that this measure targets venues primarily operating high-stakes Category B3 machines with jackpots up to £500, yet hundreds of sites owned by operators such as Merkur and Admiral maintain bingo licences that preserve access to discounted business rates despite limited bingo activity on the premises.

Details of the Tax Adjustment and Sector Response

The duty rise applies specifically to gaming machines in adult gaming centres, and data from regulatory records shows that many such locations have operated under bingo licences issued by the Gambling Commission. These licences allow continued eligibility for business rates relief even as the venues focus on slot operations, creating a distinction that the Budget changes do not fully address. Analyses of licensing data indicate that more than 200 arcades remain registered in this category across the UK, with on-site verifications confirming minimal bingo offerings in several cases.

Operators and Licence Structures in Practice

Companies including Merkur and Admiral hold significant numbers of these dual-purpose registrations, which permit slot machine activity alongside bingo permissions. Regulatory filings reveal that the venues generate the majority of revenue from Category B3 machines, while bingo sessions occur infrequently or in limited formats. This arrangement stems from historical licensing practices that predate the current tax framework, and records show the pattern has persisted through multiple regulatory updates. Figures from Gambling Commission databases highlight how such registrations cluster in high-street locations, where operators maintain compliance with both gaming and rates provisions.

Guardian examination of these records, cross-referenced with venue visits in November 2026, identified the scale of the pattern and documented how bingo elements occupy only small portions of floor space in many sites. The Express reported parallel findings on the same arrangements, noting that operators retain the discounted rates structure under existing bingo permissions. Those who reviewed the licensing data observed that Category B3 machines dominate the operational focus, whereas bingo activity registers at lower volumes in the inspected locations.

Regulatory Context and Implementation Timeline

The duty increase takes effect in April 2027, giving operators a window to adjust financial models ahead of the change. Business rates relief removal applies directly to adult gaming centres without bingo licences, whereas the retained discounts for licensed bingo venues create a measurable difference in operating costs. Records indicate that the over 200 identified sites represent a substantial portion of the high-street slot sector, and the arrangements allow continued access to relief provisions tied to bingo status. Data compiled from Gambling Commission sources shows consistent registration patterns that predate the 2026 Budget announcement, with minimal shifts in licensing categories observed in recent years.

Analysis Findings from Available Records

Cross-checks between licensing databases and physical site assessments confirmed that bingo activity in these venues often consists of occasional sessions rather than primary operations. The analysis placed emphasis on the concentration of Category B3 machines, which deliver the higher jackpots and form the core revenue stream. Observers who examined the records noted that the bingo licence route provides a pathway for rates relief that remains available under current rules, even after the Budget measures take hold. This setup appears in multiple chains, where operators balance slot-focused layouts with the minimal bingo compliance needed to sustain the discount eligibility.

Conclusion

The October 2026 Budget establishes a higher Machine Games Duty rate alongside the removal of certain business rates benefits, yet the persistence of bingo licence registrations maintains a distinct cost structure for over 200 venues identified in the review. Regulatory records and site verifications document the prevalence of these arrangements, which continue to operate under the existing framework as the April 2027 implementation date approaches.